Elementis: Sale of Specialty Rubber business
Elementis plc announced that it has agreed to sell its Specialty Rubber business headquartered in Yateley, UK ("Linatex"), to private equity funds managed by Navis Capital Partners ("Navis") for a net cash consideration of approximately US$30.8 million (£17.6 million) on a cash free, debt free basis. Navis is an Asian-based investment company.
Linatex is a leading international manufacturer of wet abrasion resistant rubber products and process equipment. In the year ended 31 December 2004, Linatex's operating profit was £0.2 million on sales of £45.9 million with net assets of £17.1 million, excluding cash and debt. After taking account of transaction costs and net asset levels at the time of the sale, Elementis expects to record a one time book loss on sale of around £7.0 million.
Net proceeds from the sale will be used to make an additional contribution to the UK pension scheme of £7.0 million, with the balance going to reduce net borrowings. Completion is expected to take place before the end of 2005.
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